TIDMACL
RNS Number : 3969M
Acal PLC
13 October 2016
For Release
7.00am, 13 October 2016
Acal plc
First Half Trading Update
Acal plc (LSE: ACL, "Acal" or "the Group"), one of the leading
international suppliers of customised electronics to industry,
today issues a trading update for the six months ended 30 September
2016 ahead of publishing its half-year results on 29 November
2016.
For the first half, the Group expects to report further good
progress with double digit growth in underlying operating profit as
anticipated. Orders were 18% higher than the previous year, and
sales 10% higher. In the Design & Manufacturing division, sales
were 24% higher and in Custom Distribution 2% lower. Our outlook
for the year remains unchanged.
The business continues to perform well despite the general
economic uncertainty. As anticipated and reported in July, first
half organic sales were slower. However, as gross margins have
remained robust along with tight cost control, profitability levels
have been maintained.
Since the first quarter, orders have increased and are showing
good levels of organic growth in line with our expectations of
achieving stronger sales in the second half of the year. Second
quarter orders grew organically by 3% over the prior year and
September order intake was better than expected being 6% higher
than prior year. First half Group organic orders and sales were 1%
and 8% lower respectively.
Given the international nature of the Group's business, we are
benefitting from the translation effect of Sterling's decline in
value since the end of June(1) partly offset by the impact of
higher US Dollar purchases.
As part of our ongoing focus on efficiency improvements, a
restructuring programme is being implemented in the Custom
Distribution division that will reduce management numbers, close
one unprofitable business subsidiary in Europe and reduce
administrative costs whilst maintaining customer and sales focus.
This is in addition to the previously announced actions that have
resulted in the closure of three small Nordic production sites and
the further integration of purchasing and production processes in
the Design & Manufacturing division.
In total, these actions, which are being implemented during the
current financial year, are expected to achieve cost savings of
GBP4m per annum and deliver sustained profitability improvements
next year and beyond. A one off associated exceptional cost of
around GBP8m is expected to be incurred this year relating
primarily to people and property costs.
Acquisitions remain an important part of the Group's growth
strategy and we have a pipeline of opportunities that are
progressing well.
The Board remains confident in our future prospects as we
continue to execute our strategy and we look forward to further
updating shareholders at our interim results in November.
For further information please contact:
Acal plc 01483 544 500
Nick Jefferies - Group Chief Executive
Simon Gibbins - Group Finance Director
Instinctif Partners 020 7457 2020
Mark Garraway
Helen Tarbet
James Gray
Notes to First Half Trading Update
1. The average sterling rate of exchange weakened 12% against
the Euro for the 6 months ended 30 September 2016 compared with the
average rate for the first half last year (falling from EUR1.39 to
EUR1.226), weakened 11% against the US Dollar and weakened 10%
against Nordic currencies on average
2. All growth rates are against the equivalent prior year period unless stated.
3. Organic growth for the Group is calculated at Constant Exchange Rates ("CER"), including the pre-acquisition periods of the Flux Group, Contour, and Plitron which were acquired last financial year (on 5 November 2015, 7 January 2016 and 1 February 2016 respectively).
4. The information contained within this announcement is deemed
by the Company to constitute inside information as stipulated under
the Market Abuse Regulation. Upon the publication of this
announcement via Regulatory Information Service, this inside
information is now considered to be in the public domain.
About Acal plc
Acal is a leading international supplier of customised
electronics to industry. It designs, manufactures and distributes
customer-specific electronic products and solutions to 25,000
industrial manufacturers and is listed on the London Stock Exchange
(LSE: ACL).
Acal has two divisions: Design & Manufacturing and Custom
Distribution. The majority of its sales comes from products and
solutions which are created specifically for a customer. Acal works
across a range of technologies, namely Communications &
Sensors, Power & Magnetics, Electromechanical & Shielding,
Embedded Systems, and Photonics & Imaging.
Acal operates through the following wholly-owned businesses:
Acal BFi, Contour, Flux, Foss, Hectronic, MTC, Myrra, Noratel,
Plitron, RSG, Stortech and Vertec. It has operating companies and
manufacturing facilities in a number of markets, including the UK,
Germany, France, the Nordic region, Benelux, Italy, Poland,
Slovakia and Spain, as well as in Asia (China, India, South Korea,
Sri Lanka and Thailand), North America (the US and Canada), and
South Africa.
This information is provided by RNS
The company news service from the London Stock Exchange
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October 13, 2016 02:00 ET (06:00 GMT)